Property Investment

Real estate investing is an art and just like any other art, it requires a lot of time, effort and management to master in this business sector as well. Apart from good marketing skills you need to take heed of many other factors that have a great influence on the money that can be earned from investing in real estate sector. One of the most important factors directly proportional to any type of real estate investment is ‘time’.

Be it a beginner, a medium paced investor or an expert, each and everyone needs to identify the best time for investing in this business in order to reap maximum profits from the investments. Here are some of the solid reasons saying why now a great time to invest in real estate is:

1.      Lowered Home Prices

Real estate sector has seen gone through a roller coaster ride in the past few years. But now it has started showing signs of improvement and as a result the home prices have been lowered to a great extent. If you are planning to invest in real estate then this is the most appropriate for buying a property.

2.      Lowered Rate of Interest

Most of the banks have lowered the rate of interest on home loans, mortgage loans and other types of loans related to real estate. Hence, this is a great opportunity for all types of buyers, as you will have to pay less compared to what you would pay at high interest rates.

3.      Increase in Number of Foreclosure Properties

The recent ups and downs in the real estate market have left many mortgaged homeowners in a great pitfall. It has been observed that, due to failure in keeping up with the mortgage payments large numbers of homeowners have shifted to rental properties, increasing the number of renters to a great extent. This has created a room for potential investors as this offers them with an opportunity to buy rental properties without any undue pressure of making mortgage payments.

4.      Short Sale Market

Buying a foreclosure property might sound risky to some of the investors as it requires lot of efforts to determine whether the property is free from all kinds of disputes. Due to decrease in home prices, many investors who own old properties have come with short sale markets where you can find some very profitable deals.

Investing in real estate can prove to be very rewarding if and only if you go step by step. It is very essential to determine a perfect time for buying and selling of properties in order to avoid any kind of losses.

It’s all kicking off in emerging markets.

They’ve been having a tough time amid fears of a China slowdown and the US scrapping quantitative easing (QE).

Investor favourites such as Thailand, the Philippines and Indonesia took a pounding yesterday. Brazilian shares are now in bear market territory.

Meanwhile, their currencies are plunging – the Indian rupee is at a record low against the US dollar, and the South African rand is at levels not seen in four years.

So what’s going on? And will it spread further?

Pay attention to your gut

The most idiotic and damaging idea that ever caught on in finance is the notion that investing is a rational process.

It involves people. How can it be rational?

So in among all the number-crunching and data-watching, I’ve found that it pays to listen to your gut as well.

I’m going to share one of my personal ‘early warning’ signs with you. When people in the City start talking up investment prospects for Africa, I get a horrible sinking feeling in my gut. It usually means the bullish times are drawing to an end.

Now, I find Africa exciting as an investment idea. It also seems to me that the economic situation in many parts of Africa is generally improving. So this isn’t a comment on prospects for the continent at all.

But of all the ‘frontier’, high-risk markets out there, Africa is pretty much still number one. So when the City starts trying to punt Africa to private investors, it suggests that risk appetite is approaching extremes. People are only thinking of potential gains, without considering potential losses – or past disasters.

Source: http://moneyweek.com/emerging-markets-are-crashing-what-does-it-mean-for-your-money/

If you’re looking into real estate investments, you likely want to earn wealth on real estate based on risk you are taking, while minimizing the amount of time you need to spend attending to the property. In order to accomplish this, you need to make some smart choices upfront when buying investment property. Your goal should be to strive to get as close as possible on as many of these optimal scenarios as possible:

Pays a Fair Cash-on-Cash Return

When you buy property you are taking money out of your liquid financial assets – stocks, bonds, CDs – and investing it into a very illiquid asset – real estate. You were earning a rate of return on your financial assets, such as 4 percent or 6 percent, and you should strive to earn a fair cash-on-cash rate of return on your real estate. To do this, you need to pro forma your deals and buy cash flow-positive properties that earn you decent returns – not those prize properties that are negative, negative, negative. For more guidance on this, see Smart Investing – A Tale of Two Town homes.

Isn’t Too Risky an Investment

All real estate is extremely high risk. Development of real estate, land, Tenant-In-Common (TIC) investments, private real estate funds, fixer uppers, etc., all have much higher risk profiles than just simply buying a nice established cash flow investment property. In many of those investments, you will never see a dime of your money again because there are just so many things that can go wrong! So if you want to own real estate, consider simply taking fee simple title in your own name – or an entity you wholly own – to the properties you purchase. In addition, you must do the proper due diligence, analyze, test, review reports, etc., to make a lower risk real estate decision.

Source: http://www.forbes.com/sites/zillow/2013/05/21/three-things-that-make-a-great-real-estate-investment/

It will be my pleasure to write this column each month to help investors with their property journey. I have big shoes to fill after Ian Hosking Richards has been writing his column since issue No 24 in July 2009, almost three years ago. His advice has been so well received that readers voted him Real Estate Agent of the Year for three years in a row. On behalf of all readers I would like to say a big thank you to Ian for all his words of wisdom. He has the ability to break everything down to the basics and make it easy to understand and apply, and I know he has inspired many, many investors, including myself, to their own success.

So what can I bring to the table? My number one credential is that I have gained a vast amount of experience by learning from Ian over the last five years since I first met him. There I was, a novice investor, sitting in the audience at a property seminar having “light bulb moments” listening to Ian’s strategies for making investing easy. Why don’t they teach this in schools, I asked myself, as this information is invaluable for anyone wanting to learn how to successfully invest in property.

My second credential is that I followed Ian’s most important piece of advice – I took action straight away. Within a week I had a finance assessment done, received the green light to go ahead, and I bought my first investment property with Ian’s help and guidance. I have repeated the process many times since that first meeting, and have grown my investment portfolio to eight properties. Read more

Investment Decisions
Investors like to dabble into various markets for investing their money. Shares, stocks, gold, silver, and property are the commonest forms of investment.

Investment in property is a hot favorite with investors but it’s not an easy proposition. There are a lot of factors to be considered before you decide to invest in a certain piece of property. Property markets are highly fluctuating due to dynamic market conditions. Getting the maximum returns on your investment is the goal of all investors, and it is, in fact, the very reason why people want to invest. Nobody wants their money to remain stagnant and get the same amount after a period of years. They need money to grow when invested. If you want this, you must invest your money wisely. For doing that, you must consult an experienced investment advisor, who has a very profound knowledge of property markets and its various intricacies.

Clear Investment Goals
Firstly, you must consider what your investment goals are. Are they short-term or long-term? What are your expectations in term of monetary returns? Do you need frequent monetary help for fulfilling your various needs, or you need money for special events like gifting to your child for their wedding or saving for their educational needs?

Real Estate Appraisal
Before investing in property, you must know its price thoroughly. Here comes the tricky point where many people stand a high chance to be duped. Here is when the need for a real estate appraisal comes into picture. Getting a property appraisal done from a legal, certified appraiser is paramount before buying property. If you skip them and directly invest in a certain piece of property, you may not get the correct price for the value of a property. It’s highly possible that you might pay more for property that isn’t so valuable after all. Read more